September 25, 2014

Fires are Latest Woe for Sugarcane Producers in Sao Paulo

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Sugarcane producers in the state of Sao Paulo continue to see losses mount in their 2014/15 sugarcane harvest. After a severe drought impacted the crop last December and January, a lack of rainfall in recent months has now led to an increase in the number of fires in the state's sugarcane fields.

The Union of Sugarcane Industries (Unica) reported this week that fires, either accidental or intentionally set, have afflicted 5% of the sugarcane fields in the state. The combination of fires and the continued dry weather has led Unica to lower its estimate of the state's sugarcane crop by 15% compared to 2013/14, or a reduction of 40 million tons.

The fires have hit fields where the sugarcane had not yet reached harvest maturity and Unica estimates that yields in those fields will be down by at least 12% or the equivalent of 10 kilograms of sugar production per ton of sugarcane harvested. In monetary terms, it equates to losses of R$ 1,500 to R$ 1,700 per hectare.

The continued dry weather during most of 2014 has led to more fires all across the state and not just in the sugarcane fields. Environmental officials have recorded fires in pastureland, other crops, and forested areas. In total, they have reported 2,981 fires in the state from January through early September which represents a140% increase compared to the same period in 2013.

When sugarcane used to be harvested by hand, fire was routinely used to burn off the dry leaves before the workers entered the field. The resulting air pollution got so bad that state officials worked with sugarcane producers in the state in 2007 to develop voluntary measures to slowly replace hand harvesting with mechanical harvesting and thus, eliminate the need for burning. During the 2013/14 harvest season, 83.7% of the sugarcane in the state was mechanically harvested and that is expected to go even higher in 2014/15. There are a few exceptions to the ban on burning including small family farmers or areas where the slope is too steep for mechanical harvesters.

While the ban on burning has led to improved air quality, it has also led to the elimination of tens of thousands of jobs for low-skilled cane cutters. In response, the state has established retraining programs for the displaced workers, but the opportunities for these low-skilled workers remains limited.